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The bankruptcy of Philadelphia Energy Solutions LLC, the biggest refiner on the U.S. East Coast, has invigorated efforts to overhaul a 13-year-old federal program promoting biofuels that has drawn bitter criticism from the oil industry.

Senator John Cornyn, a Republican from Texas, is drafting legislation that aims to stem compliance costs for refiners while encouraging the construction of storage tanks and blender pumps needed to get more biofuel into cars. Separately, fellow Texas Republican Senator Ted Cruz is mulling other changes that Trump’s Environmental Protection Agency could adopt administratively.

The efforts represent the best chance at overhauling the Renewable Fuel Standard since it was created by Congress in 2005. They also could resolve a political headache for President Donald Trump, since the current program forces him to choose between two important political constituencies: Iowa farmers growing corn for ethanol and Pennsylvania laborers who toil in the state’s four oil refineries.

"On the one hand, the president made a promise to protect the RFS, and on the other hand he also made a promise to protect manufacturing jobs," said Brendan Williams, vice president of government relations for New Jersey-based refiner PBF Energy Co. "And the current structure of the RFS is putting manufacturing jobs at risk in Pennsylvania and across the country."

The conflict grew sharper Jan. 21, with the bankruptcy filing PES, which operates the largest oil refinery serving the New York Harbor gasoline and diesel market. Chief Executive Gregory Gatta partly blamed the move on the "incredibly burdensome cost of complying with the Renewable Fuel Standard."

That law forces PES and other refiners to use biofuel -- and prove they have satisfied annual quotas with tradable credits known as Renewable Identification Numbers, or RINs. But refiners are affected unevenly by the mandate. Independent refiners that lack infrastructure to blend biofuel, such as PES, must buy RINs instead.

The cost of those credits has skyrocketed, Gatta said, with last year’s $218 million tab more than twice the PES payroll and representing the company’s single largest expense after crude oil.

Pennsylvania politicians, large manufacturing unions and refiners that want an RFS overhaul say the PES bankruptcy is fresh evidence that change is needed. Pennsylvania Governor Tom Wolf has asked the EPA to pare biofuel quotas, as have the heads of three other states. The United Steelworkers warned that "continued indifference by the administration and EPA will only drive more East Coast refineries into bankruptcy." And Representative Lou Barletta, a Republican from Pennsylvania, said that "without immediate action, more than 2,000 direct union jobs in the Philadelphia area could be lost."

Biofuel backers counter that current policy isn’t to blame for the PES bankruptcy. Opponents of the biofuel industry are "trying to capitalize on one company’s failed business model," said Bob Dinneen, president of the Renewable Fuels Association, a Washington-based trade group. It’s disingenuous "to hold this up as the poster child for the RFS."

The Trump administration has limited room to maneuver and address the issue without Congress, after farm-state senators forced EPA Administrator Scott Pruitt to rule out several possible RFS reforms last year. The EPA also rejected a bid by some independent refiners to lift the biofuel quota obligation for them and shift that burden to fuel blenders instead.

Trump’s former regulatory adviser, Carl Icahn, pushed for changes to the RFS program that the billionaire called "rigged." And Trump got involved personally after farm-state senators complained the EPA was poised to undermine the biofuel mandate, with the president instructing Pruitt to keep those factions happy.

Cornyn is working on a possible solution with Senate colleagues and Representative John Shimkus, a Republican from Illinois, to create a new RIN for biofuels blended in excess of the 10% of ethanol that’s widely found in gasoline at filling stations. Those compliance credits could fetch higher prices -- potentially encouraging sales of gasoline with greater ethanol concentration and the construction of infrastructure to support it. Cornyn’s legislative draft, still being developed as of Wednesday, includes some elements advanced by Marathon Petroleum Corp.

Separately, Cruz is considering policy changes that EPA could implement administratively. Among the possible options: EPA selling its own credits for when RIN prices reach established price ceilings, with revenue earmarked for construction of new infrastructure to get more biofuel to the market.

Both efforts could be pared with sweeteners for the biofuel industry, including a policy change to allow gasoline containing 15% ethanol to be sold year-round.

"We think there is a way to ensure we are still using robust volumes of biofuel without bankrupting domestic refiners," Williams said. "I don’t think anybody wants this situation to spread to other refiners; its not good for the country, it’s not good for our nation’s fuel supply, and I would argue it’s not good for the biofuel sector either."

Swift administrative action can be followed by creative legislative solutions, said Scott Segal, an attorney with Bracewell LLC who is closely following the issue. "Given what has happened with PES, it makes sense to advance administrative reforms as soon as possible with legislative action creating a later, durable set of reforms."

Still, biofuel legislation is difficult to pass in Congress, as it divides senators from the Corn and Rust Belts, and that may become harder heading into November’s elections. Another challenge: The oil industry itself is divided over the best solution.

While some independent refiners are eager to keep RIN prices in check, the effort is quietly being fought by other companies that produce and refine crude and make money selling the compliance credits.

To succeed, any effort needs to win over biofuel producers and their allies on Capitol Hill, including their unofficial leader: Iowa’s senior Republican senator, Chuck Grassley.

Grassley offered a dim view of the RFS reform effort Tuesday, telling reporters on a conference call that there is no need for legislation and signaling his concern about any cap on RIN prices: "It’s pretty clear what that would do to the industry."

And some biofuel industry champions are bluntly warning Trump of political consequences in the Midwest. "Of course Pennsylvania is an important political state and you have to be careful," said Brooke Coleman, director of the Advanced Biofuels Business Council. But it’d be a mistake "to put your party on the wrong side of an industry that’s absolutely crucial to agriculture, from farms to tractors."